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Japanese automakers Honda and Nissan have announced they are exploring a merger to better compete with other automakers.
What’s the deal: In an announcement, Japanese automakers Nissan and Honda revealed that they are entering talks to explore a potential merger, with Mitsubishi Motors also participating in the discussions. The merger, if finalized, would establish a joint holding company by August 2026, creating the world’s third-largest automaker by sales, putting them right behind Toyota and Volkswagen. Under the proposed structure, Honda would take a leading role in managing the new entity while keeping the distinct brand identities of all three companies.
Why they’re exploring this: All three companies argued that the reason for the merger was to keep pace with rivals in the electric vehicle (EV) market, particularly from US and Chinese automakers. As the industry shifts toward EV and autonomous technologies, Nissan, Honda, and Mitsubishi acknowledged the need to combine their resources and capabilities to accelerate innovation, reduce costs, and meet rising consumer demands for EVs. The merger also aims to better position the companies to compete against other industry leaders like Tesla and Chinese-owned BYD.
In addition, all three companies cited rising costs in manufacturing, logistics, and procurement as another reason for a merger. According to the companies, by merging, they could leverage their combined purchasing power to achieve a 7–9% reduction in component costs and optimize transportation logistics, reducing expenses by 12%.
Reactions from two execs: In a statement, Nissan President Makota Uchida said, “Today marks a pivotal moment as we begin discussions on business integration that has the potential to shape our future. If realized, I believe that by uniting the strengths of both companies, we can deliver unparalleled value to customers worldwide who appreciate our respective brands.”
Toshihiro Mibe, a Honda executive, said, “Creation of new mobility value by bringing together the resources including knowledge, talents, and technologies that Honda and Nissan have been developing over the long years is essential to overcome challenging environmental shifts that the auto industry is facing.”
